2002-08-16 -- Kelley, Dennis -- Indictment -- News Release

Accountant Charged with Bank Fraud in Tri-State Armored Car ATM Fraud

TRENTON - A Haddonfield accountant was arrested today on an indictment charging conspiracy to commit bank fraud, U.S. Attorney Christopher J. Christie announced.

In an initial appearance in federal court in Camden, U.S. Magistrate Judge Robert B. Kugler set Kelley's bail at $100,000 to be secured by his home in Haddonfield. Magistrate Kugler ordered that the bond be signed by Kelley's wife. Magistrate Kugler further ordered that Kelley be confined to his home with electronic monitoring and that he be barred from preparing tax returns or financial statements.

Kelley was arrested early today at his home by Special Agents of the FBI and IRS Criminal Investigation section.

According to the Indictment, from about August 2000 through in or about September 2000, Kelley conspired with Nicholas Basile, William Mottin and others to defraud First Union Bank and obtain money under the control of First Union Bank, by means of materially false and fraudulent pretenses, representations and promises.

Tri-State Armored Services ("Tri-State"), based in Hammonton was in the business of storing customer bank's funds and replenishing and servicing customer bank's ATMs.

Basile, 33, of Sewell, was the Director of Human Resources for Tri-State and then Acting President from September 2000 through March 2001. William Mottin, 46, of Sewell, was the President of Tri-State until September 2000, when Basile took over.

Tri-State closed its doors on March 1, 2001, and filed for bankruptcy protection. Mottin pleaded guilty to conspiring to launder monetary instruments and was sentenced on April 15 to 39 months imprisonment. Basile pleaded guilty on Jan. 7, 2002, to conspiracy to commit bank fraud and is scheduled to be sentenced on Oct. 7, 2002, by U.S. District Judge Garrett E. Brown, Jr.

The Indictment further states that the scheme to defraud First Union was based upon Kelley creating false financial statements for Tri State for calendar years 1998 and 1999. The Indictment further states that after Kelley created the false financial statements, he delivered them to Basile, who, in turn, gave the financial statements to another Tri-State employee to submit to First Union Bank. Ultimately, First Union Bank relied on the false financial statements when it entered an expanded service contract with Tri-State to replenish and service First Union's ATMs. First Union is now claiming a loss of approximately $606,000.

Despite indictment, every defendant is presumed innocent, unless and until found guilty beyond a reasonable doubt following a trial at which the defendant has all of the trial rights guaranteed by the U.S. Constitution and federal law.

Christie credited Special Agents of the FBI, under the direction of Special Agent in Charge Louie F. Allen; and Special Agents of the Internal Revenue Service Criminal Investigation section, under the direction of Special Agent in charge Anne D. Fahy, with developing the case against Kelley.

Under U.S. Sentencing Guidelines, the judge to whom Kelley's case is assigned would, if Kelley is convicted, determine the actual sentence based upon a formula that takes into account the severity and characteristics of the offense and the defendant's criminal history, if any.

The Government is represented by Assistant U.S. Attorney Norv McAndrew of the U.S. Attorney's Criminal Division in Trenton.

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